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An investment in energy stocks has gotten trickier this week as oil prices stumble but, for those willing to stay the course, Canada`s heavy oil producers may offer a short term advantage.
"The underlying economics for heavy oil is very attractive right now," said William Lacey, FirstEnergy Capital analyst. "It`s generally cheaper to find and, for the moment, the price you receive for it is relatively better [than light crude]." In recent months, a growing industry trend towards barrels of crude oil getting heavier has taken hold and, as demand increases, so too has the price of heavy oil relative to light crude.
The benchmark for heavy oil pricing in Western Canada is the Western Canadian Select Blend or WCSB stream formed through the co-operation of Canadian Natural Resources, EnCana Corp, Petro-Canada, and Talisman Energy.
A combination of various heavy oil and bitumen streams, as well as blendstocks such as condensate and synthetic crude oil, it has become a desirable crude source for many refiners.
Overall pricing for WCSB has averaged 70% (equal to a 30% differential) of WTI, the global benchmark for light crude prices.
Read the full article here.
"The underlying economics for heavy oil is very attractive right now," said William Lacey, FirstEnergy Capital analyst. "It`s generally cheaper to find and, for the moment, the price you receive for it is relatively better [than light crude]." In recent months, a growing industry trend towards barrels of crude oil getting heavier has taken hold and, as demand increases, so too has the price of heavy oil relative to light crude.
The benchmark for heavy oil pricing in Western Canada is the Western Canadian Select Blend or WCSB stream formed through the co-operation of Canadian Natural Resources, EnCana Corp, Petro-Canada, and Talisman Energy.
A combination of various heavy oil and bitumen streams, as well as blendstocks such as condensate and synthetic crude oil, it has become a desirable crude source for many refiners.
Overall pricing for WCSB has averaged 70% (equal to a 30% differential) of WTI, the global benchmark for light crude prices.
Read the full article here.